Buyers line up for ExxonMobil assets

ExxonMobil’s Australian refinery and downstream oil assets are believed to be in the crosshairs of private equity, foreign groups and local buyers as the US-based giant also looks to stage an exit from its $US2bn ($2.9bn) Bass Strait oil and gas interests.

A sale could net Exxon an additional $1bn in proceeds on top those it will receive from selling its portfolio of Australian oil and gas assets, thought to be worth close to $US3bn.

The sales process for its upstream oil and gas assets will start next year.

Sources say Exxon’s Altona Refinery and downstream assets, such as tanks and trucks to supply petrol stations throughout Australia, could be worth between $800m and $1bn and have already attracted a number of suitors.

A major global buyout fund — believed to be either Kohlberg Kravis Roberts, The Carlyle Group or Blackstone — is understood to be looking, while Japanese-backed petroleum company Idemitsu Australia Resources is also said to be an interested buyer, as is a joint venture formed between Macquarie Group and BP Oil.

Chinese parties are said to be circling.

Altona Refinery, based in Victoria, produces several refined petroleum products, including unleaded petrol, diesel and jet fuel to supply about half of Victoria’s petroleum fuel needs.

It produces more than 14 million litres of refined fuel products daily, which is enough to fill about 330,000 cars.

Bids are understood to be due before Christmas.

While it is unclear what bank is working on the sale, JPMorgan is working with Exxon to sell its Gippsland Basin oil and gas joint venture in the Bass Strait, estimated to be worth close to $US3bn.

ExxonMobil owns a 50 per cent interest, with resources giant BHP controlling the remainder. Questions remain over whether BHP will also sell out.

So far, possible buyers touted are groups such as Beach Energy, AGL Energy, Cooper Energy, Macquarie and Brookfield and other buyout funds.

Some are also not discounting Australian infrastructure investor APA Group as a contender for the assets as part of a broader consortium.

The Gippsland Basin Joint Venture produces oil and gas from Bass Strait and now supplies between 40 per cent and 50 per cent of east coast domestic gas demand.

As part of the joint venture, Exxon also owns the Kipper gas field in the same area, with its 30 per cent interest estimated to be worth about $US800m.

IBISWorld says ExxonMobil has a 19.5 per cent share of the petroleum refining and petroleum and fuel manufacturing market.